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ICICI Prudential Asset Management Company’s massive Rs 10,600 crore IPO got off to a solid start on Friday. The issue, which opened for subscription, was booked 72% on day one with strong institutional demand leading the charge.
The numbers tell an interesting story. Qualified institutional buyers subscribed 1.97 times their allocation. That means the big money was clearly interested. But retail investors? Only 21% subscription. Non-institutional investors came in at 37%. The shareholders of ICICI Bank, who had reserved quota, subscribed 44%.The IPO closes on December 16, so there are still four days for subscriptions to build. With institutional demand already strong, the issue is likely to get fully subscribed before the bidding window closes.
The Numbers Behind the Deal
ICICI Prudential is India’s second-largest mutual fund house by assets under management. The company manages about Rs 79,88,000 crore in assets. Its parent, ICICI Bank, owns 51% of the equity. UK-based Prudential Corporation Holdings owns the remaining 49%.This IPO is entirely an offer for sale. That means Prudential is selling 10% of its stake to raise money. The price band is Rs 2,061 to Rs 2,165 per share. At the top end of the range, the company is valued at Rs 1,07,000 crore, or about $12.8 billion.
All the proceeds from the IPO go to Prudential, not to the company itself. ICICI Bank gets nothing from this listing. But the bank retains its 51% stake and control of the company.
Institutional Money Came in Early
Before the public subscription window opened, the company had already raised Rs 3,022 crore from 149 anchor investors. The Singapore government was the single-largest buyer. Various sovereign funds together bought 14% of the anchor book.
That early money from anchors signalled confidence. When sovereign wealth funds and major institutional investors are willing to buy at the IPO price, it suggests they think the stock will do well after listing.
Valuation Questions
At the valuation implied by the IPO price, ICICI Prudential trades at what analysts call “stretched valuations.” The company’s net profit grew 29% in FY25 to Rs 2,650 crore. But the valuation already reflects much of that growth, which is why some brokerages are cautious.
Grey market speculation suggests the stock could list at an 8-9% premium, meaning opening day gains of around Rs 175-190 per share. That’s modest compared to recent IPO listings that saw bigger first-day pops.
What Happens After Listing
When ICICI Prudential debuts on December 19, it becomes the fifth ICICI Group company to go public. It joins ICICI Bank, ICICI Prudential Life Insurance, ICICI Lombard General Insurance, and the recently delisted ICICI Securities.
The mutual fund industry in India is growing. Assets have expanded sixfold over the last decade. More Indians are moving money into mutual funds instead of keeping it in bank deposits or gold. That’s driving demand for fund management services.
ICICI Prudential is competing with HDFC AMC, Nippon Life India AMC, and several smaller players. The top four fund houses control over half the industry’s assets. ICICI Prudential holds about 13% of quarterly average assets under management.
For Investors
If you’re thinking about applying, remember this is a secondary sale. Your money doesn’t go to the company. It goes to Prudential, which is exiting part of its stake. The company itself will continue operating as it does now.
The mutual fund business is stable and growing, but not exciting. Fund managers earn money through asset management fees. ICICI Prudential makes steady profits. But the stock won’t be a rocket. It’s more of a defensive, quality holding for long-term investors.
The key question is whether you think the valuation makes sense at Rs 2,165 per share. If yes, apply. If not, wait to see if the stock cools down after listing.
